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THE WORLD TODAY

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Friday, October 12, 2012

Why should the federal government bother to impose
taxes when it can use the Federal Reserve to "print" all the money it
needs to pay its bills? Last year, the Fed bought 77 percent of all of
the government's new debt, which is the equivalent of printing money.
The government borrowed almost 40 cents for each dollar it spent, with
the Fed printing 30 cents of each dollar spent through its bond
purchases (creating new money) — an amount equal to about 7 percent of
gross domestic product.

Federal lawmakers have created an economic mess with
their chronic overspending and inability to deliver stable, pro-growth
tax policies. Perhaps the elections will break the Washington gridlock
and knock loose some solutions. Until then, state capitols are the only
place where there is real fiscal progress.

Two governors—Scott Walker of Wisconsin and Chris Christie of New
Jersey—have gained national attention for their changes to government
pension and union rules. But other state leaders are making
breakthroughs on taxes, and they are the focus of Cato's new "Fiscal
Policy Report Card on America's Governors."
Four governors received an "A" grade: Sam Brownback of Kansas, Rick
Scott of Florida, Paul LePage of Maine and Tom Corbett of Pennsylvania.
Messrs. Scott and Corbett have been the most tightfisted on spending,
but all four "A" governors are outstanding tax reformers.

In every U.S. presidential election, the major party
candidates vie to see who can appear tougher on China. Once the election
is over, however, the substance of U.S. policy toward China usually
changes little and is far more pragmatic than the campaign rhetoric.
There are ominous signs, though, that things could be different this
time.

The accusations have been among the most caustic ever. Republican
presidential nominee Mitt Romney has denounced the Obama administration
for being "a near-supplicant to Beijing" on trade matters, human rights
and security issues. An Obama ad accuses Romney of shipping U.S. jobs to
China through his activities at the Bain Capital financier group, and
Democrats charge that Romney as president would not protect U.S. firms
from China's depredations.

Colonialism of the Mind – Part I

“Les intellectuels ont toujours été des courtisans. Ils ont toujours vécu dans le palais.” Pier Paolo Pasolini (1922-1975)
Western journalists increasingly assume the voices of subjugated
countries’ natives while muzzling them by denying them access to the
press. In the United States, the more visible venues of the alternative
press, such as online news sites Truthout, Common Dreams, and Huffington Post are essentially closed to native writers. This colonialism of the mind is rampant when it comes to Haiti.
Inspect the U.S. alternative press for news of Haiti. You will find
articles there by Beverly Bell, Mark Weisbrot, Robert Naiman, Jane
Regan, Noam Chomsky, Stephen Lendman, and others, but you will be hard
put to find a Haitian name. Westerners, whatever their political
leaning, do reserve their right to rule the world, and the right to
pontificate to the ignorant natives is very much a part of it.

Muslim Rage: “Clash of Civilizations” as Imperialism Key Narrative

It is hard to contest that 9/11 was the opening salvo of the notion
of “clash of civilization”, a simple yet effective concept to justify a
state of permanent war. Permanent wars against some elusive “enemies”
generate a constant state of fear which in return allows governments to
curtail some of the most basic liberties. What is better than a
concept such as the endless war on terror to justify any actions against
any countries? If the narrative of “clash of
civilizations” started 11 years ago, in the immediate aftermath of
9/11/2001, the recent events in the Middle-East show that we are still
living in this nightmarish engineered reality. The notion of conflict of
civilizations has a lot more in common with crusades or clash between
religions than clash between actual cultures or people. It is concocted
and fueled by the rulers of the global system to create conflicts
between people who are intrinsically on the same side. It is the
ultimate tool of repression invented by the global 1 percent to keep the
99 percent divided.

Global War Economy: The Empire of the US Military Industrial Complex

Arguably, ever since entering World War II, the United States of
America’s economy has been a war economy. Starting or fostering wars
became essentially, independently of geopolitical reasons, a “good”
business proposition. The early 1940s marked the start of the era of
systematic wars for profit. War defined as the ultimate capitalist
enterprise. The extraordinary war efforts of World War II turned the
United States into a giant global arms factory for the war in Europe
and in the Pacific. It was even, cynically, credited as the main factor
in ending the Great Depression of 1929.
This trend continued at a slower pace, but without any real
interruption, with the Korean war in the early 1950s, the Vietnam war in
the 1960s until the early 1970s, and various proxy wars worldwide-
including Afghanistan in the 1980s- against the Soviet Union. The event
of 9/11/ 2001 gave American politicians the unique opportunity to start
the perfect war on behalf of their friends and patrons of the military
industrial complex. It is the endless war: the “war on terror” without
any geographic boundaries, time frame or even the necessity to have a
well defined enemy.

DNC and RNC: Same Circus Different Clowns

The Republican National Convention and the Democrat National
Convention are the political equivalent of “America’s Got Talent”. The
two conventions should be about serious discussions concerning issues
and policies amongst the rank and file of both parties. They are not
supposed to be about showmanship and performances, but in a country
where politics have become spectacle, they are. Both Conventions are
circus masquerading as democracy. It is all about giving a sense to the
American people that they have a real choice, real options, and that
their voice matters. But as matter of fact, the politicians/celebrities
who are in the limelight do the talking while the “little people”- the
delegates- do the listening, and mostly the cheering, as if they were
given laughing or clapping cue cards. Meanwhile, the “Big Guns” of the
political theater are just figureheads working on behalf of
transnational interests. Barack Obama is currently auditioning for an
extension of his tenure as CEO of America Empire Inc., while Mitt
Romney- already member of the board- is trying to move up the corporate
ladder.

The blood on Che’s shirt – by Caroline Carlson

The
first time I saw a Che Guevara T-shirt was in the eleventh grade. I
didn’t know who Che Guevara was, but was instantly able to recognize him
whenever I saw kids walk through the halls wearing T-shirts and
carrying backpacks or lighters with his face on them. The image – a
young Argentinian man with long hair and a beret – became almost
universally known and sparked a global marketing campaign.
Unbeknownst to many young people, Che Guevara was an international
terrorist who aided Fidel Castro in the overthrow of the Cuban
government in the late 1950s. After leading a two-year guerrilla
campaign against Cuban dictator Fulgencio Batista, he led firing squads
against alleged war criminals, created a “labor camp” system in Cuba
that imprisoned and killed Jehovah’s Witnesses and homosexuals and
oversaw the deaths of more than 1,000 people.

US: A Modest Proposal For Our President – Investors.com

Subsidies:
With the economy faltering and Middle East unrest rising, President
Obama acts as though the biggest issue facing the country is Mitt
Romney’s alleged threat to “Sesame Street.” We have an idea for him.
According to a recent tally, Obama brought up either Big Bird or Elmo
13 times in speeches since last week’s debate, in which Romney promised
to end federal support for PBS and NPR.
That compares
with zero mentions of how he plans to revive the economy, and no
references to Libya. And he’s now running an ad featuring Big Bird.

Americas: Knocking
off the kingpin of a monstrous drug cartel won’t end the war in Mexico.
But the Mexican navy’s killing of Zeta boss Heriberto Lazcano is
nevertheless a big victory — and not just south of our border.
Lazcano, who was gunned down just 80 miles south of Laredo, Texas,
ran the most powerful, treacherous and violent drug cartel in Mexico.A military
deserter turned trafficker, Lazcano pioneered the most horrific
spectacles of the drug war: beheadings; bodies dangling from bridges;
heads posted on pikes, strewn across highways, thrown in front of schools, burned in cars and unearthed from mass graves.
Mass murder was another speciality. The Zetas directed a
terrorist-style attack on a casino in Monterrey that killed 52, and
slaughtered 72 mostly Central American illegal immigrants near the U.S.
border. They are also assassins, targeting dozens of mayors, governors
and editors in an obvious strike at Mexico’s democracy.

California was once the land of opportunity, but it is going down the tubes.
Several of California’s prominent cities have declared bankruptcy,
such as Vallejo, Stockton, Mammoth Lakes and San Bernardino. Others are
on the precipice, and that includes Los Angeles, California’s largest
city.
California’s 2012 budget deficit is expected to top $28 billion, and
its state debt is $618 billion. That’s more than twice the size of New
York’s state debt, which itself is the second-highest in the nation.

Budget
wonk Paul Ryan scored several decisive blows over formidable debater
Joe Biden in this evening’s debate face-off, hitting the administration
on its missteps and misinformation following the Benghazi murders and
its failure to improve job growth. But Biden played to the crowd
throughout the night, sidestepping questions while snickering and
expressing exasperation with his opponent on every topic.
The Republican ticket was riding a polling bump after presidential
challenger Mitt Romney scored the most decisive debate win in history
over President Barack Obama last week, but Ryan had a tall task: to
maintain momentum while highlighting his expertise in fiscal policy and
proving competence in foreign affairs and defense, a historical weak
area for the ticket.
Moderator Martha Raddatz, senior foreign affairs correspondent for
ABC News, began the debate with a discussion of Libya, asking
hard-hitting questions about why the administration failed to provide
adequate security for the Benghazi consulate and why the White House
spread wrong information about the nature of the attacks.

Sponging boomers

The economic legacy left by the baby-boomers is leading to a battle between the generations

ANOTHER economic mess looms on the horizon—one with a great wrinkled
visage. The struggle to digest the swollen generation of ageing
baby-boomers threatens to strangle economic growth. As the nature and
scale of the problem become clear, a showdown between the generations
may be inevitable.
After the end of the second world war births surged across the rich
world. Britain, Germany and Japan all enjoyed a baby boom, although it
peaked in different years. America’s was most pronounced. By 1964
individuals born after the war accounted for 41% of the total
population, forming a generation large enough to exert its own political
and economic gravity.

Inequality and the world economy

True Progressivism

A new form of radical centrist politics is needed to tackle inequality without hurting economic growth

BY THE end of the 19th century, the first age of globalisation and a spate of new inventions
had transformed the world economy. But the “Gilded Age” was also a
famously unequal one, with America’s robber barons and Europe’s “Downton
Abbey” classes amassing huge wealth: the concept of “conspicuous
consumption” dates back to 1899. The rising gap between rich and poor
(and the fear of socialist revolution) spawned a wave of reforms, from
Theodore Roosevelt’s trust-busting to Lloyd George’s People’s Budget.
Governments promoted competition, introduced progressive taxation and
wove the first threads of a social safety net.
The aim of this new “Progressive era”, as it was known in America, was
to make society fairer without reducing its entrepreneurial vim.
Modern politics needs to undergo a similar reinvention—to come up
with ways of mitigating inequality without hurting economic growth. That
dilemma is already at the centre of political debate, but it mostly
produces heat, not light. Thus, on America’s campaign trail, the left
attacks Mitt Romney as a robber baron and the right derides Barack Obama
as a class warrior. In some European countries politicians have simply
given in to the mob: witness François Hollande’s proposed 75% income-tax
rate. In much of the emerging world leaders would rather sweep the
issue of inequality under the carpet: witness China’s nervous
embarrassment about the excesses of Ferrari-driving princelings, or
India’s refusal to tackle corruption.

Hope and change, four years on

FOR a reminder of how unusual the 2008 election was, consider a hit
video from that year, “Yes We Can”, by the hip-hop artist will.i.am. The
black-and-white film—viewed online many millions of times—set a Barack
Obama campaign speech to music. To the strumming of an acoustic guitar
and the tinkling of a piano, sundry famous folk crooned along to footage
of Mr Obama making a series of vows: that nothing can stand in the way
of millions calling for change, that Americans are not as divided as
their politics suggest and that their nation can be healed and the world
repaired if they just remember a three-word creed: “Yes, we can”.
It says something about the lingering potency of Mr Obama’s
victory—winning as he did on a platform of racial and political
reconciliation—that the video is poignant rather than risible when
re-watched today. An especially painful moment shows the fresh-faced Mr
Obama of 2008 scorning advice not to offer voters false hope, retorting that in America: “There has never been anything false about hope.”

VP debate exposes Democrats’ desperation

The 2012 presidential election is one of the most momentous crossroads in U.S. history. As Wisconsin Rep. Paul Ryan, the GOP’s vice-presidential nominee, stated in his Thursday debate against Vice President Joe Biden,
the outcome on Election Day will determine “what kind of country we are
going to give our kids.” Under Obama-administration policies,
out-of-control government spending has grown to such an extent that
federal debt is now larger than the gross domestic product of the United
States, the largest economy in the world. U.S. power and prestige in
the world are in such dramatic decline that armed Islamists can overrun
an American diplomatic compound, murder a U.S. ambassador and get away
with it.

Say whatever you want about last night’s debate, there is one thing we can all agree on. Joe Biden sure was happy.
How happy was the vice president? He looked happier than Bill Clinton with a bottle of Viagra and an intern.

Photo Gallery:

Vice President Joseph R. Biden
on Thursday seemed to open the door to adjusting President Obama’s tax
increases to only apply to those making $1 million or more a year — a
much higher threshold than the $250,000 level they had pushed
previously.
But the Obama campaign said Friday that Mr. Biden
was only “providing an illustration” of how the tax increase would be
divided out and that the president sticks by his bigger tax-increase
plan.

It was interesting to me when, after the vice-presidential debate,
Fox News Channel interviewed Chris Wallace and Charles Krauthammer, both
of whom said they had never seen a more “disrespectful” participant in a
debate than Joe Biden.

Once again, Joe Biden lied his way through a Vice Presidential
debate--just as he did in his contest with Sarah Palin in 2008. This
time, the media caught a few of Biden's worst "malarkey" moments--as did his opponent, Paul Ryan, when he could get a word in edgewise.

Liberals are more pleased with moderator Martha Raddatz than
conservatives are disappointed. And it's easy to see why. Raddatz
allowed Joe Biden to interrupt Paul Ryan repeatedly during the Vice
Presidential debate, and interrupted Ryan herself, while posing
questions that were radically in favor of the Obama team. Ryan overcame
Raddatz's bias and won the debate regardless, leaving less for
conservatives to complain about.

Still, it is worth noting the facts. While the candidates' speaking
time was roughly equal--not counting crosstalk, Biden spoke for 38:25
and Ryan 37:27--Raddatz’s questions were not in any way a measure of
equality. She hit the Republican no fewer than nine times with pointed
questions that were either an attack on Romney/Ryan or a way to set up
excuses for Obama.

The biggest lie Vice President Joe
Biden told tonight was a whopper. And somehow it like got past moderator
Martha Raddatz, who we were told knows everything about foreign policy.
Biden made the patently false and outrageous claim that no one in the
Obama administration knew that requests for extra security had been made
by our Libyan ambassador, Christopher Stevens, and other members of our
consulate in Benghazi.

The Obama campaign is struggling to respond to mounting criticism of
Vice President Joe Biden's bizarre behavior during last night's debate
with Rep. Paul Ryan.

Thursday, October 11, 2012

The first time I met Raghuram Rajan,
the Indian economist couldn’t sit still.
It was over coffee in Bangkok in November 2008, less than
two months after Lehman Brothers Holdings Inc. imploded and
almost took the global financial system down with it. Rajan had
become a big draw by then, having warned as early as 2005 that a
crash was coming. On that day in Thailand, he had a more local
crisis on his hands: The hotel’s WiFi was out.

Election campaigns are about
promises: the more grandiose, the better.
Who can forget President Barack Obama’s June 2008 speech,
telling a rapt audience that future generations would look back
at his victory in the Democratic primaries as “the moment when
the rise of the oceans began to slow, and our planet began to
heal”?

About Caroline Baum

Caroline Baum, a columnist for Bloomberg News since 1998, is the author of "Just What I Said: Bloomberg Economics Columnist Takes on Bonds, Banks, Budgets and Bubbles."More about Caroline Baum

If only he had substituted “deficit” for “oceans.”

Candidates love to promise the moon -- at minimum, a colony
on it -- and the stars. Years ago, they could avoid mentioning
the cost. Nowadays, the U.S. is in such a deep fiscal hole that
a candidate would appear to be out of touch if he didn’t invoke
“shared sacrifice” or pay lip service to reducing the deficit.
Yet that is where they draw the line and limit the
specifics. Which is why I’m here to tell you five things the
2012 Democrats don’t want you to know. (Next week, it’s the
Republicans’ turn.)